How to make riped cloth?
Here's one way. Assuming you are using a texture file like this with transparency (alpha) for the ripped texture.

Select the banner vertices on your model. In UV Editing: open your texture file with the ripped banner, U Unwrap, position your faces atop the image, Set this vertex group as a UV Map.

With our banner selected, in the shader editor set up a texture for our banner like this, add a new texture, Shit+A to add nodes. Calling the image file with an Image Texture and specifying your UV Map in the UV Map or Texture Coordinate node. Don't forget to connect the alpha to make the ripped and tattered area transparent.

You'll probably want to add more geometry to the banner so it hangs more naturally. Note the banner in this method has no thickness only flat geometry.
Hope that helps.